I don’t know, if Episode is permanently removing your story, I doubt it’s without a very valid reason. As many others have said, they usually give you a chance to correct the errors before taking such extreme disciplinary action. Say, if it’s a story with millions of reads, they won’t want to remove it from their platform because that’d be a direct loss of profit; so they have a little give to the rules.
99% of the time, I don’t have an issue with sexual theme because most authors know where to draw the line and use the necessary warnings. Most of the time it’s suggestive, but doesn’t cross the line into pornography. The issue with authors is, which you already mentioned, that they get a little carried away and write something that isn’t appropriate for a young audience. It sucks that they can’t freely express themselves; but it’s written clearly in the guidelines and authors know the risk of ignoring them. If they get in trouble, that’s really on them. Every platform has rules to abide by in order to protect and keep their community safe, and failure to abide by them results in consequences.
Does episode enforce these rules fairly? Of course not, you’d be silly to think they do and I sincerely hope they eventually get better with this.